Joe Kennedy, manager of operations at Teradyne's semiconductor testing equipment plant, just got off the phone with his counterpart from Solectron and with a concerned expression on his face looked down at the mountain of paperwork on his desk. It was April, 2003 and the Solectron manager had just informed him that the Solectron plant at Westborough, Massachusetts, which supplied some of their most important subassemblies, was scheduled to be shut down. This not only meant having to relocate production lines for Teradyne's subassemblies for its FLEX line of products but also jeopardized the new Teradyne/Solectron Lean Development Program that started to implement the Supply Chain Express methodology at that very same Solectron plant. The big questions running through Joe's head were: What would this mean for the new initiative towards a lean supplier-manufacturer system? Should Teradyne continue to develop and implement such a program? Furthermore, as this new problem of the Westborough plant closure emerged it demonstrated the risk of having 'all your eggs in one basket' at one supplier. Would going the sole-supplier route be too risky in implementing such a lean program or was it necessary for a successful program, in order to build the integration points and trust needed to make it work?
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